A British-based Russian tycoon has revealed that his compatriots ‘gripped by panic and frenzy’ are rushing to hide their wealth as Government sanctions kick in for oligarchs linked to President Vladimir Putin.
Dimitry Tsvetkov, 41, who is worth an estimated £200million, claimed that the offices of top-level lawyers and financial advisors in London are ‘crammed’ with rich Russians exploring ways to swerve sanctions that could lead to their property, money and other assets being frozen.
Providing a rare insight into the normally secretive world of the UK’s Russian elite and how they are responding to the Government’s pledge to financially ‘squeeze’ them, Mr Tsvetkov told MailOnline: ‘All the conversations over the past few days within the rich Russian community have been about how to hide their assets.
‘It is the number one topic that is dominating all of them.
‘I know because I’m one of them and this is all everybody is speaking or thinking about.’
Dimitry Tsvetkov (above), 41, who is worth around £200m, claimed that the offices of top-level lawyers and financial advisors in London are ‘crammed’ with rich Russians exploring ways to swerve sanctions that could lead to their property, money and other assets being frozen
Mr Tsvetkov added: ‘I met with a private banker the other day who deals with rich Russians in the UK and across Europe and they did not stop ringing him. Top lawyers’ offices in London are crammed with Russians discussing how to hide their wealth under the rules of attorney-client privilege.
‘Everyone who has something of substance is panicking. There is a complete frenzy at the moment to hide your wealth as quickly as possible.’
The Government has made changes to its Economic Crime Bill which will enable tougher sanctions to be introduced quicker.
The bill, which now goes to the House of Lords and is expected to become law later this month, contains several measures to tackle oligarchs and companies associated with Putin.
This includes forcing foreign owners of UK companies to declare and verify their identities with prison sentences of up to five years for those who refuse to do so; strengthening Unexplained Wealth Orders, to prevent corrupt money from being invested in property; and making it simpler to sanction individuals.
The Government has also vowed to increase the number of wealthy Russians it has sanctioned. It has so far targeted 13 but the US and EU have hit 100 in the pocket.
Mr Tsvetkov is currently undergoing a divorce from his wife, Elsina Khayrova (pictured) , 33 and they are battling in the courts over their multi-million estate, which also includes five apartments in London worth a total of £18million
But Mr Tsvetkov claimed that many wealthy Russians in the UK, who are millionaires rather than billionaires and many not have political links are also ‘panicking’ because of uncertainty over who exactly more sanctions will affect.
He said: ‘The oligarchs are multi-billionaires so are a bit insulated from the sanctions. If you are worth £10 billion for example, and half of that is frozen, you are still very wealthy and you will get back what has been sanctioned at some stage.
‘It is the multi-millionaires who stand to lose the most, because freezing half of £10 million for example, will impact you a lot more.’
Mr Tsvetkov revealed that many of them earn money from companies based in Russia and are no longer able to transfer funds to the UK because of Government sanctions against banks in the country.
He added: ‘They are now worried about paying school fees, golf club memberships and how they’ll able to maintain their lifestyle. So, the solution is to hide your money, regardless of whether or not you’re an oligarch close to Putin.’
Mr Tsvetkov refused to identify any individuals within the UK’s Russian elite who have started hiding assets but revealed that a popular mechanism is to shift them into an International Trust.
His mansion in Surrey boasts its own pool, spa, wine cellar and cinema and underground car park with space for ten cars
Mr Tsvetkov claimed that many wealthy Russians in the UK, who are millionaires rather than billionaires and many not have political links are also ‘panicking’ because of uncertainty over who exactly more sanctions will affect
These are registered in a jurisdiction with more favourable asset protection laws than the country where you reside and take over ownership of them for a specified period of time.
Other mechanisms include transferring assets temporarily to a notary or lawyer or to an international bank. Countries such as Luxembourg, Malta, Cyprus and others in Asia all have laws that allow for this.
Wealthy UK Russians are also diversifying their investment portfolios away from stocks and shares and into gold.
Mr Tsvetkov was speaking from his luxury £23 million home on the exclusive Wentworth estate, where a number of other wealthy Russians also live.
He maintains that despite the onset of tougher sanctions, his extensive network of contacts within the luxury property sector have informed him that there has so far not been a ‘fire sale’ of Russian owned residential properties.
He said: ‘Rich Russians will sit it out rather than panic sell. At the end of the day, even if you’re sanctioned, you still remain the owner of your home and can live in it because it will not be seized by the authorities.’
Mr Tsvetkov (pictured in the light blue suit on the right), next to Francois Graff, at the opening of a Graff store in May 2015
Mr Tsvetkov is currently undergoing a divorce from his wife, Elsina Khayrova, 33 and they are battling in the courts over their multi-million estate, which also includes five apartments in London worth a total of £18million, lavish properties in Cyprus and a £2million penthouse in Dubai – a property portfolio worth around £42million in total.
His Wentworth home has an estimated £10 million worth of art on display with paintings by Picasso, Pierre-Auguste Renoir and Marc Chagall.
Almost £5 million worth of luxury cars, including Ferraris and Bentleys are parked in a basement garage.
Mr Tsvetkov insisted that he made the bulk of his money outside of Russia through his work as an advisor specialising in corporate takeovers, mergers and acquisitions and as an art dealer. He also ran a Graff diamond business and once owned shares in a coal mine.
Despite his wealth, Mr Tsvetkov maintains that he is one of the few rich Russians in the UK not concerned about sanctions as he is considered an enemy of Putin and does not see himself as an oligarch because he does not have as much money as them.
He is also on the Kremlin’s most wanted list after being accused of attempting to defraud the Russian Ministry of Defence.
Mr Tsvetkov denies the charges, which he protests were trumped up by his business opponents.
He insisted: ‘I’m fully financially transparent, I can account for every penny I’ve made and how I made it. I’ve nothing to hide and know that these sanctions will not affect me at all.
‘I have no affiliation the Russian political elite and can’t even return to the country because I will be immediately arrested. I left Russia in 2005 because I did not like the political system there and realised that things would only get worse, as has been the case.’
Mr Tsvetkov became a British citizen in 2010 but retains his Russian passport and also has Cypriot nationality.
https://www.dailymail.co.uk/news/article-10594009/British-based-Russian-tycoon-says-compatriots-gripped-panic-rushing-hide-wealth.html
